Eni Reports Natural Gas Discovery off Egyptian Coast

31 Aug 2015 | Author: | No comments yet »

Eni Reports Natural Gas Discovery off Egyptian Coast.

The field could hold up to 30 trillion cubic feet of lean gas, the company ENI, +0.49% said. ROME — The Italian energy company Eni SpA announced Sunday it has discovered a “supergiant” natural gas field off Egypt, describing it as the “largest-ever” found in the Mediterranean Sea. He said “important synergies with the existing infrastructures can be exploited, allowing us a fast production startup.” Eni has been in Egypt since 1954 through its subsidiary IEOC. Eni is the operator of the concession and holds the contractor’s entire working interest. “The exploration activities are central to our growth strategy: in the last 7 years we have discovered 10 billion barrels of resources and 300 million in the first half of the year,” Chief Executive Claudio Descalzi said in a statement.

A subsea well also will be used to limit costs. “This is a confirmation of our strategy of developing conventional assets in mature areas where we have strong geological knowledge and where we have synergies,” said Mr. Descalzi. “We have done that very successfully in the past 3-4 years.” It will take several months to sort out the development and production leases, and drilling is expected to begin early next year, said Mr. If drilling starts in early 2016, production would likely kick off about a year later based on similar projects. “We will fast track this project and production will begin as soon as possible,” Mr.

Descalzi said. “This discovery is transformational for Eni and especially for Egypt.” While Eni in recent years has generally sold stakes in its big finds to share the development costs, that is unlikely to happen with the just-announced Egyptian field due to the relatively low development costs, said Mr. Eni, through an Egyptian subsidiary, has complete control of the exploration and will have a 50% stake in the production with the rest held by the Egyptian state oil and gas company.

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